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In the wake of the Borders bankruptcy, there’s a lot of jeering about how brick-and-mortar book retailers are destined for the trash heap. Conventional wisdom claims that the same way Blockbuster was passed by as DVD rentals became a quaint anachronism, so will booksellers become another victim of the Internet revolution.

Not so fast — Barnes & Noble (NYSE:BKS) just provided a glimmer of hope with its earnings report today. Numbers impressed Wall Street and sent shares soaring as much as 17% in early trading.

So what is B&N doing right these days?

In the short term, the biggest boost to Barnes & Nobles has been its evolution into digital sales via its BN.com website and its e-reader, the Nook. But longer term, the strength of Barnes & Noble could be its ability to become the only major bookseller that survived the digital revolution — allowing it to become a whale in the smaller pond of brick-and-mortar sales now that the competition is gone.

Here are the specifics of Barnes & Noble earnings: The New York-based bookseller lost $57 million, or 99 cents per share, for the quarter. Clearly that’s not sign for celebration. However, the silver lining was news that total sales actually were up 2% year-over-year.

The reason for the increase was even more noteworthy — a stunning 140% year-over-year revenue growth in its Nook e-reader business. Total Nook business was $277 million. In other impressive digital news, sales at BN.com jumped 37% year-over-year to $198 million, again thanks to the success of Nook and related digital content.

Add those digital sales up and you get an impressive $475 million. Total revenue was $1.42 billion on the quarter, meaning the Nook and BN.com now account for more than a third of Barnes & Noble’s revenue. That’s quite an encouraging sign to investors.

How did B&N pull this off? Well, the company is reaping the rewards of an earlier push into the digital arena than its peers. Although the Nook isn’t a leader in the e-reader space, its November 2009 release has allowed the device to at least build a decent following as a secondary player in the market.

Amazon (NASDAQ:AMZN) has been eating the lunch of bookstores for years via brisk online book sales, and now the Amazon Kindle and Apple (NASDAQ:AAPL) iPad are torching hard-copy book sales with digital titles. BN.com and the Nook clearly haven’t toppled these giants but have managed to generate enough business to keep the lights on at Barnes & Noble.

This is a crucial fact investors and consumers can’t overlook. Don’t be fooled by the earnings headlines focusing on the Nook, because toppling Amazon.com’s digital sales or matching the popularity of the iPad is going to be nearly impossible for B&N. The power of Barnes & Noble in the long term will be its ability to complement its traditional sales operations with its digital successes.

Borders went under, and many other booksellers are struggling. But even the least literary of Americans must admit there remains a role for brick-and-mortar locations, even in 2011. There’s something to be said for browsing titles at the bookstore and lingering over a latte in the café — the same way many consumers grab a pretzel at the mall and try on jeans before buying.

Barnes & Noble has put more time on the clock with the success of its digital push and will continue to grow its Nook and BN.com sales to diversify its business. But though the company clearly could benefit from “right sizing” its retail operations to reduce losses, the competitive advantage of Barnes & Noble in the long term might be its ability to outlive its competitors.

It would be easy to write off BKS stock as the next publicly traded company doomed for failure. Shares are off about 7% this year even after this impressive pop today, and they are down 12% in the past 52 weeks. But the Nook doesn’t have to be the next iPad and BN.com doesn’t have to be Amazon.com for this company to remain relevant. They just need to generate enough interest to keep B&N in the game — and buy enough time for the company to adjust its retail operations accordingly.